Simplify FRS 102 compliance with AI-powered lease accounting software

FRS 102 is the UK and Ireland accounting standard for small and medium-sized enterprises (SMEs). It aligns UK GAAP more closely with IFRS, and includes updated policies for leases, revenue recognition, and fair value assessments.

Companies preparing financial statements under UK GAAP must ensure compliance with FRS 102 for accounting periods beginning on or after January 1, 2026. Early adoption is permitted.

For most calendar-year entities, FRS 102 financial statements must be filed by April 2025. However, for a smooth transition to the new requirements, organizations should begin preparing now: reviewing leases, evaluating contracts, and ensuring disclosures are finalized ahead of submission dates. 

In 2025, key updates to FRS 102 include:

• On-balance sheet lease accounting for most lessees, aligned with IFRS 16, with exemptions for short-term (<12 months) and low-value (<£5,000) assets.
• A new five-step revenue recognition model, consistent with IFRS 15 and ASC 606.
• Expanded disclosure requirements and updates in fair value measurement, supplier finance arrangements, share-based payments, and income tax.

Using AI-powered lease accounting software like Trullion helps companies stay ahead of these changes by automating compliance.

AI-driven platforms like Trullion simplify FRS 102 compliance by:

• Automatically extracting key data from leases, POs, and contracts.
• Applying OCR and natural language processing to automatically reconcile data.
• Generating audit-ready journal entries, amortization schedules, and disclosures.

This reduces manual workload, minimizes error risk, and accelerates compliance.

FRS 102 is aligned more closely than before with IFRS 16 and ASC 842, particularly around lease capitalization and revenue recognition. However, differences remain – including with lease exemptions and simpler disclosure requirements.

Trullion supports all three standards, helping global finance teams standardize lease accounting across multiple jurisdictions.

Companies need to gather:

• Lease start and end dates
  Payment schedules and discount rates
• Termination and extension clauses
• Modification histories
• Classification of short-term and low-value leases

AI platforms like Trullion centralize this data with version history and full audit trails, making compliance faster and more reliable.

Yes. Trullion’s AI-powered lease accounting automates journal entry creation, amortization schedules, and note disclosures required under the updated FRS 102 framework. Every data point is source-linked for auditability and transparency

Industries with large lease portfolios – including retail, logistics, real estate, and education – are most impacted by FRS 102. Trullion supports all of these sectors with scalable, automated compliance and reporting tools.